Link to my book :- https://docs.google.com/viewer?a=v&pid=sites&srcid=ZGVmYXVsdGRvbWFpbnxqa2hjbGlmZXN0eWxlfGd4OjM5NmM2NTViMjAzY2M5MTk
Of Money and Men
The most practical of all issues is, of course, money, money, money.... which makes the world go round. If you still recall our newly learned know-how, you will realize that money as we use it in our financial system of a market ( or capitalistic ) economy is a man-made Hybrid Reality (HR). Money by itself is merely pieces of paper or some plastic material such as in the case of the Australian currency. It is only by human institutional power ( in this case the Australian Legislature empowering the independent Reserve Bank of Australia ) ascribing financial values to the currency that money carries its assigned value usually based on the laws of supply and demand on Australian goods and services. In short, the Australian currency is the i.o.u. issued by a legal entity brought into being by the Federal Parliament in Canberra, ACT ( Autralian Capital Territory ) which is democratically elected by the citizens of the Australian Commonwealth. This kind of managed currency is also known as fiat money ( “ by fiat “ means in the place of ) meaning it is a stand-in for the real values money represents. As such, it is not as rigid as the physical laws of nature. That means HR can and should be changed to keep in step with the requirements called for by the relevant circumstances. This is lesson number one.
In the olden days of a barter economy, all resources are distributed or passed around by physical exchanges among the owners of such resources. Only the right buyers and sellers can strike a deal. This is obviously cumbersome and money was invented by some clever merchants as a medium of exchange. Older forms of money are not fiat money because the issuer of fiat money must have a good credit standing and trustworthiness on account of the i.o.u. nature of fiat money. There were no such persons or entities around. Therefore, most early monies have intrinsic and tangible values in themselves such as gold which is precious and scarce or sea shells that are rare. Even today, gold is still the safest kind of money but with a carrying cost in terms of the foregone interest income if an equal amount of value is held in the bank as money deposits. This is the opportunity cost for holding gold instead of money but gold is the only kind of money that is not someone else's liability. Therefore, it is the safest money available since the user need not investigate the credit standing of the previous owner. You can simply rely on
gold's face value.
It is precisely this nature of money as a medium of exchange that has given rise to a lot of undesirable side effects. Since money is only a means to an infinite number of ends ( i.e. to exchange for other goods and services ), it can represent endless goodies and this gives rise to greed for money which translates into greed for all material stuff. Money is the power of access to everything worldly. Very few people can resist the temptation of money. Show me a person who does not like money and I will call him a saint. At the philosophical level, human beings should not be greedy if they really understand the true reality of the physical world and their own limited capacity to enjoy physical goodies. This is the reason why I consider IGNORANCE the greatest of all mortal sins because the failure to understand this world and oneself leads to the second greatest mortal sin which is GREED. All other sins are derived from ignorance and greed. Consider the usual misdeeds we call mortal sins such as fornication ( greed for sexual gratification ), gambling ( greed for easy money ), alcoholism ( greed for consuming alcohol ), gluttony ( greed for food ), pride ( greed for other people's admiration and recognition ), cruelty ( greed for blood and other people's suffering ), injustice ( mostly done out of greed both for physical things and perverted mental satisfaction ), jealousy ( greed for obsessively possessing one's loved ones or precious goods ). All sins are related to greed one way or another. If you only knew how limted human capacity to enjoy was, you will never be
The most practical of all issues is, of course, money, money, money.... which makes the world go round. If you still recall our newly learned know-how, you will realize that money as we use it in our financial system of a market ( or capitalistic ) economy is a man-made Hybrid Reality (HR). Money by itself is merely pieces of paper or some plastic material such as in the case of the Australian currency. It is only by human institutional power ( in this case the Australian Legislature empowering the independent Reserve Bank of Australia ) ascribing financial values to the currency that money carries its assigned value usually based on the laws of supply and demand on Australian goods and services. In short, the Australian currency is the i.o.u. issued by a legal entity brought into being by the Federal Parliament in Canberra, ACT ( Autralian Capital Territory ) which is democratically elected by the citizens of the Australian Commonwealth. This kind of managed currency is also known as fiat money ( “ by fiat “ means in the place of ) meaning it is a stand-in for the real values money represents. As such, it is not as rigid as the physical laws of nature. That means HR can and should be changed to keep in step with the requirements called for by the relevant circumstances. This is lesson number one.
In the olden days of a barter economy, all resources are distributed or passed around by physical exchanges among the owners of such resources. Only the right buyers and sellers can strike a deal. This is obviously cumbersome and money was invented by some clever merchants as a medium of exchange. Older forms of money are not fiat money because the issuer of fiat money must have a good credit standing and trustworthiness on account of the i.o.u. nature of fiat money. There were no such persons or entities around. Therefore, most early monies have intrinsic and tangible values in themselves such as gold which is precious and scarce or sea shells that are rare. Even today, gold is still the safest kind of money but with a carrying cost in terms of the foregone interest income if an equal amount of value is held in the bank as money deposits. This is the opportunity cost for holding gold instead of money but gold is the only kind of money that is not someone else's liability. Therefore, it is the safest money available since the user need not investigate the credit standing of the previous owner. You can simply rely on
gold's face value.
It is precisely this nature of money as a medium of exchange that has given rise to a lot of undesirable side effects. Since money is only a means to an infinite number of ends ( i.e. to exchange for other goods and services ), it can represent endless goodies and this gives rise to greed for money which translates into greed for all material stuff. Money is the power of access to everything worldly. Very few people can resist the temptation of money. Show me a person who does not like money and I will call him a saint. At the philosophical level, human beings should not be greedy if they really understand the true reality of the physical world and their own limited capacity to enjoy physical goodies. This is the reason why I consider IGNORANCE the greatest of all mortal sins because the failure to understand this world and oneself leads to the second greatest mortal sin which is GREED. All other sins are derived from ignorance and greed. Consider the usual misdeeds we call mortal sins such as fornication ( greed for sexual gratification ), gambling ( greed for easy money ), alcoholism ( greed for consuming alcohol ), gluttony ( greed for food ), pride ( greed for other people's admiration and recognition ), cruelty ( greed for blood and other people's suffering ), injustice ( mostly done out of greed both for physical things and perverted mental satisfaction ), jealousy ( greed for obsessively possessing one's loved ones or precious goods ). All sins are related to greed one way or another. If you only knew how limted human capacity to enjoy was, you will never be
154
greedy again. In other words, if you are no longer IGNORANT of your own limited abilities
and insignificance in the objective world you will not fall into the evil trap of GREED ever
again. Therefore, it is of utmost importance to be well informed about oneself and the
world. The word education immediately comes to mind again!
To be able to understand the pitfalls in our financial world, I must acquaint you with the concept of the limited liability company which has become the single most important vehicle for the the serious and inhumane crime of greed that is to adversely affect the lives of billions of underprivileged people of the world. When human beings first organized business ventures there were only sole proprietorships and partnerships which were all with unlimited liabilities. This meant that the owners or co-owners had to be responsible for debts owed by the business to outside creditors without limit. In extreme cases, suppose the owners had previously built up a lot of assets over the years yet a single very large claim made by the creditors in the current year would cause the owners to go bankrupt and lose all the hard earned assets accumulated over numerous years while in business. The concept of unlimited liability was originally based on the sound ethical belief that a real man should face up to his full responsibility no matter what. However, when carried to its logical conclusion in business it would mean that even a debt contracted by one partner in the name of the business would be binding without limits on all the other partners. This could lead to dishonest partners disappearing leaving massive debts to be borne by other innocent partners. In other words, the system of unlimited liability is open to fraud by dishonest elements in the business world. There is another even more serious criticism against the unlimited liability concept and that is nobody would be willing to undertake huge business ventures such as massive infrastructure projects like building airports and cross-harbour tunnels and bridges. Massive projects like these require a pooling of capital involving thousands of people. Even without criminal elements to stage fraudulent schemes to trap other partners the amount of potential and legitimate disputes amount partners would be unthinkable. No individual investor would contemplate taking part in these important project to the detriment of the economy. Such considerations subsequently led to the limited liability concept being introduced after the start of the industrial revolutionary when huge infrastructural projects like railways and grand ocean liners had to be built.
As its name indicates, limited liability allows the investors or the shareholders ( as they are called ) of a company limited by shares to limit their personal liability to the amount of the paid up capital they have invested in the company. Huge limited companies can also subject to stringent securities ( legal terminology for shares listed on stock exchanges ) regulations become publicly listed company to invite investment funds from the public. Other protections for the investors include the legal requirements to appoint independent certified public accountants and auditors to audit or to check whether or not a limited company's accounts truly and fairly reflect the profit or loss positions of the company's business which affect the amount of dividends that can be distributed to shareholders. So far so good, but the main problem with limited liability companies or corporations as they are usually called is the separation of ownership ( the legal owners of the company are the shareholders ) from the management of the company's business affairs. The management responsiblity of the company usually falls on the professional managers generally called board of directors, chief executive officers ( CEO ) and chief financial officers ( CFO ) who may or may not own shares in the company ( i.e. they may not be owners ). Even if they own certain shares, they would be more interested in the remunerations they received for their services rendered which is also partly related to the profits of the company in the form of performance bonus. At first sight, such bonus system seems to lead to a common goal for the professional managers and the shareholders alike to make more profit for the company. But this is not always so. It gives rise to the temptation for the corporate custodians ( which I think is a better name for the professional managers ) to inflate the company's profit on paper such as in the recent US court case of the convicted CEO of the energy giant corporation Enron which collapsed in 2001 due to false accounting. What can we expect from a system that is
totally motivated by greed.
There are mainly two ways dishonest corporate custodians can rip
off the company and the owners. Firstly, by manipulating the company's accounts to the
To be able to understand the pitfalls in our financial world, I must acquaint you with the concept of the limited liability company which has become the single most important vehicle for the the serious and inhumane crime of greed that is to adversely affect the lives of billions of underprivileged people of the world. When human beings first organized business ventures there were only sole proprietorships and partnerships which were all with unlimited liabilities. This meant that the owners or co-owners had to be responsible for debts owed by the business to outside creditors without limit. In extreme cases, suppose the owners had previously built up a lot of assets over the years yet a single very large claim made by the creditors in the current year would cause the owners to go bankrupt and lose all the hard earned assets accumulated over numerous years while in business. The concept of unlimited liability was originally based on the sound ethical belief that a real man should face up to his full responsibility no matter what. However, when carried to its logical conclusion in business it would mean that even a debt contracted by one partner in the name of the business would be binding without limits on all the other partners. This could lead to dishonest partners disappearing leaving massive debts to be borne by other innocent partners. In other words, the system of unlimited liability is open to fraud by dishonest elements in the business world. There is another even more serious criticism against the unlimited liability concept and that is nobody would be willing to undertake huge business ventures such as massive infrastructure projects like building airports and cross-harbour tunnels and bridges. Massive projects like these require a pooling of capital involving thousands of people. Even without criminal elements to stage fraudulent schemes to trap other partners the amount of potential and legitimate disputes amount partners would be unthinkable. No individual investor would contemplate taking part in these important project to the detriment of the economy. Such considerations subsequently led to the limited liability concept being introduced after the start of the industrial revolutionary when huge infrastructural projects like railways and grand ocean liners had to be built.
As its name indicates, limited liability allows the investors or the shareholders ( as they are called ) of a company limited by shares to limit their personal liability to the amount of the paid up capital they have invested in the company. Huge limited companies can also subject to stringent securities ( legal terminology for shares listed on stock exchanges ) regulations become publicly listed company to invite investment funds from the public. Other protections for the investors include the legal requirements to appoint independent certified public accountants and auditors to audit or to check whether or not a limited company's accounts truly and fairly reflect the profit or loss positions of the company's business which affect the amount of dividends that can be distributed to shareholders. So far so good, but the main problem with limited liability companies or corporations as they are usually called is the separation of ownership ( the legal owners of the company are the shareholders ) from the management of the company's business affairs. The management responsiblity of the company usually falls on the professional managers generally called board of directors, chief executive officers ( CEO ) and chief financial officers ( CFO ) who may or may not own shares in the company ( i.e. they may not be owners ). Even if they own certain shares, they would be more interested in the remunerations they received for their services rendered which is also partly related to the profits of the company in the form of performance bonus. At first sight, such bonus system seems to lead to a common goal for the professional managers and the shareholders alike to make more profit for the company. But this is not always so. It gives rise to the temptation for the corporate custodians ( which I think is a better name for the professional managers ) to inflate the company's profit on paper such as in the recent US court case of the convicted CEO of the energy giant corporation Enron which collapsed in 2001 due to false accounting. What can we expect from a system that is
totally motivated by greed.
There are mainly two ways dishonest corporate custodians can rip
off the company and the owners. Firstly, by manipulating the company's accounts to the
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maximum stretch of the limit allowed by law. Although this is not strictly illegal it is
definitely unethical. According to my fuzzy logic, they are fuzzy criminals to the highest
degree or virtual criminals in everyday language. Secondly, they can charge to the
company so called legitimate expenses ( such as entertainment expenses ) excessively
and provide themselves with outrageous perks such as luxurious holiday bungalows and
expensive cars. Theoretically, this is also subject to scrutiny by the auditors but the
custodians can also find ways to legitamize such expenses on the grounds of promoting
the company's business or maintaining the corporate image. The separation of ownership
and management of the corporation is the single most devastating weakness of the limited
liability concept. Due to human greed, there is a tendency for high ranking custodians to
build up a huge bureaucracy of supporting staff and purposely to pay them high salaries to
justify their even higher remunerations. There are plenty of outrageous examples of
corporate abuses by their custodians. Recently, in Australia certain big banks announced
the retrenchments of hundreds of jobs and branches to cut back on their expenditures only
to pay out millions of dollars in “ performance bonus “ to their CEO and golden handshake
payouts to retiring and early retiring high ranking officers who were connected to dubious
transactions causing huge financial losses to the corporation in question. Even worse
cases of similar scandals are very often reported in the USA where much larger financial
stakes are involved.
The main reason for the persistence in this unfortunate state of affairs can be attributable to the lack of ownership loyalty to any public corporation by shareholders in general. Unlike the traditional small businesses where there is usually no separation of ownership and management, shareholders of modern public corporations merely holds the shares or equities in a corporation mostly for speculative gains in the increase in share prices. Only when the increase in their equity prices is not enough to justify a sale will they keep the shares for the distribution of dividend which is usually a bit higher than the interest receivable from term deposits in the bank. This is because the risk factor in holding equities is considerably higher than putting your money in a bank. Risk and return is always directly proportional to each other. Thus, shareholders do not usually hold their shares for the very long term. Even for non-speculative investors they will change their holdings to other corporations without hesitation if there is a better return on their capital investments. Being only temporary owners of the corporation, the shareholders ( who are the actual legal owners of big public corporations ) very often have less loyalty to the corporation in which they hold shares than the custodians who make their careers in the corporations for which they work. Over a considerable period of time, the custodians may gradually feel that they themselves have more claim to the corporations assets than the legal owners. This kind of misguided psyche of some custodians very often leads to a mentality that is conducive to putting their own selfish interest before that of the corporation or the shareholders. This is the direct but undesirable consequence of the separation of ownership and management ot the modern public corporation. Again, I must emphasize that I am not accusing all corporate custodians across the board of fraudulent practices but I do maintain that some bad elements and the particular culture of the corporate world do contribute to various abuses of their power by virtue of the inherent weaknesses of the corporate machinery. Power tends to corrupt and absolute power corrupts absolutely. So said Acton, First Baron of England (1834-1902 ). I used to admire the powerful CEO s and their stylish ways of life when I was a kid. I was foolish enough to think that they deserved the huge resources they can control and enjoy with apparent impunity purely on account of their talents until I learn of the pitfalls in the operations of the limited companies from my economics and accounting disciplines. Now, I totally detest crooked corporate custodians. They are worse than thieves and thugs because they prey on poor old pensioners and small investors who desparately depend on their meagre amount of dividend income for their daily needs. Crooked corporate custodians obtain both financial resources and power with all the related trimmings by deception. The kind of excessive remunerations and fringe benefits ( sometimes known as benefits in kind ) pocketed by some crooked corporate custodians can run in to the tens of millions. Such excesses are simply outrageous by whatever standard by which one cares to gauge them. Unfair distribution of income in favour of these crooks is to be denounced on both moral ground of justice and economic ground of wastage and unfavourable dispositon for
The main reason for the persistence in this unfortunate state of affairs can be attributable to the lack of ownership loyalty to any public corporation by shareholders in general. Unlike the traditional small businesses where there is usually no separation of ownership and management, shareholders of modern public corporations merely holds the shares or equities in a corporation mostly for speculative gains in the increase in share prices. Only when the increase in their equity prices is not enough to justify a sale will they keep the shares for the distribution of dividend which is usually a bit higher than the interest receivable from term deposits in the bank. This is because the risk factor in holding equities is considerably higher than putting your money in a bank. Risk and return is always directly proportional to each other. Thus, shareholders do not usually hold their shares for the very long term. Even for non-speculative investors they will change their holdings to other corporations without hesitation if there is a better return on their capital investments. Being only temporary owners of the corporation, the shareholders ( who are the actual legal owners of big public corporations ) very often have less loyalty to the corporation in which they hold shares than the custodians who make their careers in the corporations for which they work. Over a considerable period of time, the custodians may gradually feel that they themselves have more claim to the corporations assets than the legal owners. This kind of misguided psyche of some custodians very often leads to a mentality that is conducive to putting their own selfish interest before that of the corporation or the shareholders. This is the direct but undesirable consequence of the separation of ownership and management ot the modern public corporation. Again, I must emphasize that I am not accusing all corporate custodians across the board of fraudulent practices but I do maintain that some bad elements and the particular culture of the corporate world do contribute to various abuses of their power by virtue of the inherent weaknesses of the corporate machinery. Power tends to corrupt and absolute power corrupts absolutely. So said Acton, First Baron of England (1834-1902 ). I used to admire the powerful CEO s and their stylish ways of life when I was a kid. I was foolish enough to think that they deserved the huge resources they can control and enjoy with apparent impunity purely on account of their talents until I learn of the pitfalls in the operations of the limited companies from my economics and accounting disciplines. Now, I totally detest crooked corporate custodians. They are worse than thieves and thugs because they prey on poor old pensioners and small investors who desparately depend on their meagre amount of dividend income for their daily needs. Crooked corporate custodians obtain both financial resources and power with all the related trimmings by deception. The kind of excessive remunerations and fringe benefits ( sometimes known as benefits in kind ) pocketed by some crooked corporate custodians can run in to the tens of millions. Such excesses are simply outrageous by whatever standard by which one cares to gauge them. Unfair distribution of income in favour of these crooks is to be denounced on both moral ground of justice and economic ground of wastage and unfavourable dispositon for
156
consumer spending because the marginal propensity to consume is much lower for ultra-
high income earners.
You may be surprised to learn that the same kind of malpractices discussed in the previous paragraph are also being carried out even in charitable and non- profit making corporations. To start with, custodians of charitable organizations are in the privileged positions of not requiring to make huge amount of profits and yet be able to hang on to their custodianships. Although their remunerations may not be as ludicrously excessive as that in the business world they can nevertheless take advantage of their organizations in other ways. One very common practice by some delinquent custodians is to engage in extravagant spending to boost their inflated ego. I have this personal experience with our own education project in China which I have mentioned in the prologue. It was our original intention to refer one well-known international charity group to take over of the project at the very beginning since we had doubts about our resources and commitment. When we request them to visit the location the high ranking custodians proposed to charter a helicopter for the visit because the drive from Hong Kong to northern Kwongtung Province would take five hours and deemed by them to be too time consuming to fit into their busy schedule. Their suggestion infuriated us so much that we finally decided to take up the project on our own. We are angery not only because of the criminal extravagance but also because of the painful realization that even custodians of such charitable organizations which are supposed to do their utmost to help the underprivileged can be so arrogant, egocentric and have a complete disregard for their declared ideals. I am not suggesting for one second that all charities work that way but we were totally terrorized by the possibility that there could be many of these irresponsible custodians out there. Another way irresponsible custodians can rip off their organizations is to receive benefits and perks from suppliers of their organizations' materials and services like going on study trips which are actually of a holiday nature to conferences and seminars conducted by these suppliers. These are tantamount to bribes given to custodians for ensuring the charitable organization's continued patronage of the suppliers' goods and services. The extra expenditures incurred by the suppliers will without a doubt be reflected in increase in the prices of their products. In worse cases, unethical suppliers may even pay monetary kick-backs to the custodians to enlist their support. Again, such illegal and unethical practices are to a large extent the result of greed on the part of the irresponsible custodians coupled with the opportunities provided by the separation of ownership and management of the organization concerned. Most important of all, we must realize that all illegal and unethical practices can only be eradicated from society by replacing a partly corrupted population with a new younger generation of high ethical standard through a sound education system. The police force and the legal system alone are not up to the task. It takes time and resources and perseverance to achieve this long term objective. A democratic and accountable government with ethical and respectable statesmen ( as opposed to politicians ) with strong leadership and foresight is desparately needed before
this noble and ultimate goal can be attained. This is our next topic of discussion.
Before we leave the topic of money, I wish to remind the reader of the limited capacity of human beings to enjoy earthly goods. The understanding of this particular aspect of our physiology will lead you to the sensible conclusion that greed is
both futile and not worth the price to be paid on both the individual and social levels. To enjoy life is our inborn right. But like all rights, the right to enjoy life is not absolute and must necessarliy carry with it the corresponding responsiblities. Furthermore, all individual rights must be subordinate to the natural laws and all just human laws enacted by any constitutionally appointed legislature elected through due democratic process. Regardless of the amount of wealth you own, there are just a finite amount of goods and services you can enjoy. How many times can you eat in a single day ? Three, four, five or six times is the best one can manage. Even if you ignore the adverse effects on our health resulting from excessive eating, your digestive function is liable to a total breakdown within a day or two upon uncontrolled intake of food. That is why ancient Romans used to performed self- induced regurgitation to make room in their stomachs for consuming more food. That sounds more like torture than enjoyment to me. Again, greed is the culprit.
As for clothing, housing and locomotion or travelling which are the other three major areas of our daily living, it is simply a question of your expectation. It can
You may be surprised to learn that the same kind of malpractices discussed in the previous paragraph are also being carried out even in charitable and non- profit making corporations. To start with, custodians of charitable organizations are in the privileged positions of not requiring to make huge amount of profits and yet be able to hang on to their custodianships. Although their remunerations may not be as ludicrously excessive as that in the business world they can nevertheless take advantage of their organizations in other ways. One very common practice by some delinquent custodians is to engage in extravagant spending to boost their inflated ego. I have this personal experience with our own education project in China which I have mentioned in the prologue. It was our original intention to refer one well-known international charity group to take over of the project at the very beginning since we had doubts about our resources and commitment. When we request them to visit the location the high ranking custodians proposed to charter a helicopter for the visit because the drive from Hong Kong to northern Kwongtung Province would take five hours and deemed by them to be too time consuming to fit into their busy schedule. Their suggestion infuriated us so much that we finally decided to take up the project on our own. We are angery not only because of the criminal extravagance but also because of the painful realization that even custodians of such charitable organizations which are supposed to do their utmost to help the underprivileged can be so arrogant, egocentric and have a complete disregard for their declared ideals. I am not suggesting for one second that all charities work that way but we were totally terrorized by the possibility that there could be many of these irresponsible custodians out there. Another way irresponsible custodians can rip off their organizations is to receive benefits and perks from suppliers of their organizations' materials and services like going on study trips which are actually of a holiday nature to conferences and seminars conducted by these suppliers. These are tantamount to bribes given to custodians for ensuring the charitable organization's continued patronage of the suppliers' goods and services. The extra expenditures incurred by the suppliers will without a doubt be reflected in increase in the prices of their products. In worse cases, unethical suppliers may even pay monetary kick-backs to the custodians to enlist their support. Again, such illegal and unethical practices are to a large extent the result of greed on the part of the irresponsible custodians coupled with the opportunities provided by the separation of ownership and management of the organization concerned. Most important of all, we must realize that all illegal and unethical practices can only be eradicated from society by replacing a partly corrupted population with a new younger generation of high ethical standard through a sound education system. The police force and the legal system alone are not up to the task. It takes time and resources and perseverance to achieve this long term objective. A democratic and accountable government with ethical and respectable statesmen ( as opposed to politicians ) with strong leadership and foresight is desparately needed before
this noble and ultimate goal can be attained. This is our next topic of discussion.
Before we leave the topic of money, I wish to remind the reader of the limited capacity of human beings to enjoy earthly goods. The understanding of this particular aspect of our physiology will lead you to the sensible conclusion that greed is
both futile and not worth the price to be paid on both the individual and social levels. To enjoy life is our inborn right. But like all rights, the right to enjoy life is not absolute and must necessarliy carry with it the corresponding responsiblities. Furthermore, all individual rights must be subordinate to the natural laws and all just human laws enacted by any constitutionally appointed legislature elected through due democratic process. Regardless of the amount of wealth you own, there are just a finite amount of goods and services you can enjoy. How many times can you eat in a single day ? Three, four, five or six times is the best one can manage. Even if you ignore the adverse effects on our health resulting from excessive eating, your digestive function is liable to a total breakdown within a day or two upon uncontrolled intake of food. That is why ancient Romans used to performed self- induced regurgitation to make room in their stomachs for consuming more food. That sounds more like torture than enjoyment to me. Again, greed is the culprit.
As for clothing, housing and locomotion or travelling which are the other three major areas of our daily living, it is simply a question of your expectation. It can
157
never be enough or it can be sufficient at a minimal but generally acceptable standard.
Imagine ladies fashion. There are all sorts of new styles every season and countless
number of designer labels. The issues of affordability and suitability aside, there is only 24
hours a day. How many times can a lady change her attire in a single day ? How many
sets of clothing are enough ? Again, the sensible answer is countless sets or a few dozens
or fewer depending on one's own expectation. One very common argument put forward
by ladies in defense of stockpiling clothes is that one must not be seen to be wearing the
same set of clothing on different formal occasions. This is really a matter of subjective
perception. if the ladies assume a more objective view, they will realize that this argument
of theirs is not completely valid because not all their friends had been present on all
previous formal occasions when a particular dress was worn. In your view you may be
repeating the same dress but from others' point of view you may be wearing the repeated
dress for the first time. Everyone's frame of reference may be different and they may hold
different but equally valid views with respect to their own perspectives ( c.f. Special
Relativity ).
Now, let us consider other mental or intellectual enjoyments. Take going to the movies or concerts for example.You will feel tired after a few hours of watching a movie or enjoying an opera. Most large scale public entertainment programs like rock concerts and other opening or closing ceremonies of popular sporting events also generally last for 3 to 4 hours because there is a finite amount of information or external stimuli a human being can meaningfully take in and enjoy. Anything beyond the tolerance limit is a waste of resources. Typically the human brain can only pay attention to between 6 to 8 unrelated items of information and make intellectual sense out of them at a single moment. Anything more than this limit will result in a jumbled up mess of meaningless signals. Besides, there is the question of time that can be spent on such entertainments.There are only 24 hours in a day and generally one third is spent in our sleep for recuperation of our energy. So, you will see that spending most of our life working like a dog to earn money for the sole purpose of enjoying earthly goods is not an unassailable proposition. In fact, it may prove to be an unwise one because I have often come across cases among my own friends who used to say that they would have time to enjoy all they want upon retirement if they could mass enough money during their working life. Alas, a poor few were recalled by the Almighty soon after their retirements and some had worked themselves to ill health that further considerably reduced their already limited capacity to enjoy earthly goods as everybody else is for reasons cited above. The Uncertainty Principle decrees that nothing can be 100% certain. Therefore, you serve yourself best by living each day as if it were the last day of your life. Only by so doing can you enjoy life to the utmost.
I remember a funny but telling story told me by my good friend Frank. A rich and powerful aged banker once went for a holiday in Tahiti, French Polynesia. He went on a fishing trip in a boat captained by a lay-back Polynesian. After they had spent a day with some good catch, they chatted with each other on their return journey to their island resort. The banker lamented that his polynesian captain could have amassed huge fortunes if only he could be more enterprising and had spent more time and effort in expanding his single fishing vessel into a whole fleet of sight-seeing and fishing boats under a huge public corporation by inviting investment capital from the investing public. As the banker was enjoying the satisfaction of being smart with his know-how in the financial market, he got the following unexpected response from his Polynesian captain. The captain responded by saying that if the banker could answer just one question from him he would follow the banker's advice to form a corporation. The banker said :- “ Just Shoot ! “. Then the captain calmly asked :- “ Where are you now ? “ The banker immediately retorted :- “ I'm in Tahiti enjoying a great holiday, of course. “ Then the captain replied :- “ You are exactly right but I have been here enjoying the beautiful sun, sea and sand all my life free of charge. Why should I bother myself like you did working so hard for 30 years and then start coming here to enjoy the same beautiful scenery that Mother Nature has provided to me and everyone else for free? “ Who is the smart guy ? It is so true. Some of the best things in life are really free only if you have the time and wisdom to find them !
After involving ourselves in the money game for a while, we tend to make money for its own sake and, most of the time, we do not even have the spare time to
Now, let us consider other mental or intellectual enjoyments. Take going to the movies or concerts for example.You will feel tired after a few hours of watching a movie or enjoying an opera. Most large scale public entertainment programs like rock concerts and other opening or closing ceremonies of popular sporting events also generally last for 3 to 4 hours because there is a finite amount of information or external stimuli a human being can meaningfully take in and enjoy. Anything beyond the tolerance limit is a waste of resources. Typically the human brain can only pay attention to between 6 to 8 unrelated items of information and make intellectual sense out of them at a single moment. Anything more than this limit will result in a jumbled up mess of meaningless signals. Besides, there is the question of time that can be spent on such entertainments.There are only 24 hours in a day and generally one third is spent in our sleep for recuperation of our energy. So, you will see that spending most of our life working like a dog to earn money for the sole purpose of enjoying earthly goods is not an unassailable proposition. In fact, it may prove to be an unwise one because I have often come across cases among my own friends who used to say that they would have time to enjoy all they want upon retirement if they could mass enough money during their working life. Alas, a poor few were recalled by the Almighty soon after their retirements and some had worked themselves to ill health that further considerably reduced their already limited capacity to enjoy earthly goods as everybody else is for reasons cited above. The Uncertainty Principle decrees that nothing can be 100% certain. Therefore, you serve yourself best by living each day as if it were the last day of your life. Only by so doing can you enjoy life to the utmost.
I remember a funny but telling story told me by my good friend Frank. A rich and powerful aged banker once went for a holiday in Tahiti, French Polynesia. He went on a fishing trip in a boat captained by a lay-back Polynesian. After they had spent a day with some good catch, they chatted with each other on their return journey to their island resort. The banker lamented that his polynesian captain could have amassed huge fortunes if only he could be more enterprising and had spent more time and effort in expanding his single fishing vessel into a whole fleet of sight-seeing and fishing boats under a huge public corporation by inviting investment capital from the investing public. As the banker was enjoying the satisfaction of being smart with his know-how in the financial market, he got the following unexpected response from his Polynesian captain. The captain responded by saying that if the banker could answer just one question from him he would follow the banker's advice to form a corporation. The banker said :- “ Just Shoot ! “. Then the captain calmly asked :- “ Where are you now ? “ The banker immediately retorted :- “ I'm in Tahiti enjoying a great holiday, of course. “ Then the captain replied :- “ You are exactly right but I have been here enjoying the beautiful sun, sea and sand all my life free of charge. Why should I bother myself like you did working so hard for 30 years and then start coming here to enjoy the same beautiful scenery that Mother Nature has provided to me and everyone else for free? “ Who is the smart guy ? It is so true. Some of the best things in life are really free only if you have the time and wisdom to find them !
After involving ourselves in the money game for a while, we tend to make money for its own sake and, most of the time, we do not even have the spare time to
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enjoy the money or family values. I am both devastated and deeply saddened by the audio
tape recordings of mobile phone conversations between the victims of the September 11
terrorists attack on the World Trade Centres in New York City back in 2001 with their
families during the final moments of their lives. How they wished they had spent more time
with their families instead of making money all the time. It is really heart-breaking. In the
course of our wealth creation process, sometimes, it becomes money for money's sake.
Still remember the bottom line I told you earlier. When you leave this world you cannot
take a single dime with you. Worse still, you may create some lazy and good-for-nothing
off-springs because they think they can rely on their parents' pecuniary legacy. So be wise
with your money and strike a healthy balance in spending it and making it. Enough is
enough but be smart about your standard of having enough money. It is all a matter of
expectation. So be reasonable and yet realistic about your own expectation with money.
There is only a marginal difference between an extra million when you are fortunate
enough to have a few in hand already. The economic law of diminishing returns has got to
have its effect even with money only few people are willing to accept this phenomenon
when it happens. When this stage is reached it becomes purely a number game. So, be a
bit generous with your own money. You have taken it from society give some back when
you are on your way out. Be compassionate with the less unfortunate as we are all from
the same stardust of this universe and all face the same harsh reality.
The very last issue about money on which I wish to comment is the Scrooge Syndrome. Everyone of us must have come across Mr. Scrooge or his close cousins at some point during our lives. The main argument put forward by Mr. Scrooge in support of his behaviour is usually this. One must be conservative and accumulate as much personal wealth as possible to increase one's protection against every possible contingency. I put it to Mr. Scrooge very strongly that he is not being conservative at all. Quite the contrary, he is taking the greatest of all risks and must end up in overdoing the act of “ Scrooging” ( a word coined by me to describe his actions ) which would lead to much greater loss in terms of personal relationships that could translate into tangible and adverse effects on him. In short, his action is bound to backfire. How so ? Well, as I see it, the only way to make sure that he had already squeezed every possible bit of benefit for himself out of a given situation is to reach the breaking point. Take buying stock and shares for example, the only sure way to confirm that the highest price has been reached is when it starts to fall and to get one's confirmation on hind sight by the drop in the share price. Otherwise, there would still be a theoretical possibility that the peak price is still to come. Scrooge would still not be satisfied at this point until the confirmation of a drop in price albeit, on hind sight has actually materialized. In terms of human relationships, Mr. Scrooge would withhold any consideration or price he would have to pay to obtain the desired return ( or reaction ) from the person he was interacting with to make sure that Scrooge need not pay a bit more than he really had to. Again, the only sure way to confirm that this absolute necessity has become unavoidable is the breaking point. The person Scrooge interacts with would protest before Scrooge could be sure that he had reached this breaking point. Unfortunately, by virtue of the most powerful Second Law of Thermodynamics of increasing entropy when something is broken the resultant entropy or disorder can never be fully restored. Scrooge cannot have the cake ( an amicable relationship ) and eat it ( and not having to pay any price to maintain such relationship ) as the saying goes. My advice to Scrooge is that the related pair of values - having the cake and eat it are another classical pair of complimentary values just as predicted by Quantum Physics. You can only have one of them materialized but never both at once. So forget about your frivolous attempt to have the best of both worlds. This is against the laws of nature. This is greed pure and simple. It is an undertaking of the highest risks you can engage in. It will certaintly lead to disaster ! Take money at its face value. Never read more into it than it can offer. You will ultimately lose all your close friends although you can still retain some who share the same kind of values as yours. I always wonder why people enjoy taking advantage of their neighbours. May be it is the evil aspect of our nature. Why can't we derive satisfaction out of giving and not taking ( advantage or anything) from others. It is more blessed to give than to receive. Taking advantage without contributing is just like a low down animal the biologists has classified as a parasite. How hideous and pathetic can it be. Respect yourself and others as human beings that are supposed to be
The very last issue about money on which I wish to comment is the Scrooge Syndrome. Everyone of us must have come across Mr. Scrooge or his close cousins at some point during our lives. The main argument put forward by Mr. Scrooge in support of his behaviour is usually this. One must be conservative and accumulate as much personal wealth as possible to increase one's protection against every possible contingency. I put it to Mr. Scrooge very strongly that he is not being conservative at all. Quite the contrary, he is taking the greatest of all risks and must end up in overdoing the act of “ Scrooging” ( a word coined by me to describe his actions ) which would lead to much greater loss in terms of personal relationships that could translate into tangible and adverse effects on him. In short, his action is bound to backfire. How so ? Well, as I see it, the only way to make sure that he had already squeezed every possible bit of benefit for himself out of a given situation is to reach the breaking point. Take buying stock and shares for example, the only sure way to confirm that the highest price has been reached is when it starts to fall and to get one's confirmation on hind sight by the drop in the share price. Otherwise, there would still be a theoretical possibility that the peak price is still to come. Scrooge would still not be satisfied at this point until the confirmation of a drop in price albeit, on hind sight has actually materialized. In terms of human relationships, Mr. Scrooge would withhold any consideration or price he would have to pay to obtain the desired return ( or reaction ) from the person he was interacting with to make sure that Scrooge need not pay a bit more than he really had to. Again, the only sure way to confirm that this absolute necessity has become unavoidable is the breaking point. The person Scrooge interacts with would protest before Scrooge could be sure that he had reached this breaking point. Unfortunately, by virtue of the most powerful Second Law of Thermodynamics of increasing entropy when something is broken the resultant entropy or disorder can never be fully restored. Scrooge cannot have the cake ( an amicable relationship ) and eat it ( and not having to pay any price to maintain such relationship ) as the saying goes. My advice to Scrooge is that the related pair of values - having the cake and eat it are another classical pair of complimentary values just as predicted by Quantum Physics. You can only have one of them materialized but never both at once. So forget about your frivolous attempt to have the best of both worlds. This is against the laws of nature. This is greed pure and simple. It is an undertaking of the highest risks you can engage in. It will certaintly lead to disaster ! Take money at its face value. Never read more into it than it can offer. You will ultimately lose all your close friends although you can still retain some who share the same kind of values as yours. I always wonder why people enjoy taking advantage of their neighbours. May be it is the evil aspect of our nature. Why can't we derive satisfaction out of giving and not taking ( advantage or anything) from others. It is more blessed to give than to receive. Taking advantage without contributing is just like a low down animal the biologists has classified as a parasite. How hideous and pathetic can it be. Respect yourself and others as human beings that are supposed to be
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endowed with more noble attributes of love and sacrifice. Down with the bad Mr. Scrooge
who ultimately realized his despicable behaviour and was finally reconverted into humanity
at the eleventh hour as a happy ending in Charles Dickens' memorable Christmas epic, A
Christmas Carol. Therefore, the evil spirit of Scrooge must be exorcised, Scrooge, be
gone !
